Forex: Thursday’s review
Yesterday the euro fell as Germany’s top economic institutes cut their 2012 forecast for growth by more than half as the spiraling debt crisis weighs on banks and spending. Growth will slow to 0.8 percent next year from 2.9 percent in 2011, according to a bi-annual independent report commissioned by the German government. In April, the group forecast 2 percent economic growth for 2012. But later the euro gain versus the dollar after Slovakia approved Europe’s enhanced bailout fund, completing ratification across the currency region.
The dollar and yen advanced versus most of their major counterparts after JPMorgan Chase & Co. reported a decline in profit and China’s export growth slowed, weakening stocks and spurring demand for a refuge.
The yen rallied after yesterday’s slide against the dollar as investors pared bets the Bank of Japan will introduce additional measures to weaken the currency.Japan’s currency tends to appreciate during economic and financial turmoil because the nation’s current-account surplus makes the nation less reliant on foreign capital.
EUR/USD: yesterday the pair fell.
GBP/USD: at first half of day the pair decreased, but restored later.
USD/JPY: yesterday the pair was under pressure.
On Friday main focus will be EU trade balance and HICP at 0900GMT and US retails sales at 1230GMT.